NEWS

China factories extend shutdown following coronavirus outbreak

Some provinces and districts have now told companies not to return to work until 1st March, according to officials.

Uncertainty about work resuming at factories in China is setting in, with provinces or cities posting different dates for an extended shutdown as the coronavirus outbreak continues to spread.

Authorities had initially said operations could pick up again on Monday, but the already-extended delay in reopening could be dragged out even further for many factories, including Apple’s largest manufacturer Foxconn.

Posting on LinkedIn, sourcing specialist, Ger Murphy, commented: “Although February 10th was the official return date, the factories are unsure about how many of their workers are returning – therefore it is likely that it will take up to two weeks before the full factory production process will be running as normal. By the end of the month, factories will hopefully be back to normal, but with a three week backlog of shipments to catch up on.” He added: “Health checks need to be conducted regularly on workers to ensure no further outbreak within the factories. Hopefully, once the zones are fully operational and clear of the virus, with good hygiene practice maintained and caution taken, China’s doors will be open again and all travel restrictions can be removed.”

But Isaac Larian, CEO at MGA Entertainment, has raised concerns regarding a shortage of adequate medicine, without which resuming work would be totally unsafe. He said: “People who live in China and Hong Kong don’t have the masks and medicine that they need in order to combat the proliferation of this virus. Last week, MGA airlifted 6,000 masks and anti-viral treatments, which were sent to our MGAE Hong Kong and China employees. Today we shipped an additional 15,000 surgical masks to Hong Kong to be distributed to the MGA employees and their families, as well as factories in China and hospitals. We will continue to do this and everything else we can do to help contain the coronavirus . Every little thing matters. The coronavirus is not solely China’s problem – the spread of the virus and the implications of the virus will impact more than those who have been or will be afflicted by it – it will impact the global economy.”

Even if businesses resume work, employees would still have to undertake quarantine requirements that last around two weeks. Last week, more than 20 provinces and other regions told businesses to not resume work before 10th February at the earliest. In 2019, those parts of China accounted for more than 80% of national GDP, and 90% of exports, according to CNBC calculations of data accessed through Wind Information.

Amongst this uncertainty, founder of Eolo Toys, Alex Prieto, sees a light at the end of the tunnel: “I strongly believe things will go back to normal soon, but the biggest problem is that workers need to travel and quarantine measures need to be taken. We will all be facing around three-four weeks’ delay, so let’s be patient and understanding with the situation. Everyone wants to ship and sell, that is normal, but we all need to keep calm. This is a special situation out of anyone’s control.”